HONDA, SUZUKI, YAMAHA : CONVENTIONAL DECISION MAKING SYSTEM

SUPPLIER - JAPAN INTERFACE 6

1 3

JAPAN OEM PURCHASING OEM R&D

4 5 2

CUSTOMER'S REGIONAL PLANT

7

*Note : SMC's decision making structure has not changed neither there is any such info. All decisions are still be ce

- Purchasing contacts potential suppliers and gives RFQ.

- Purchasing will contact mainly the suppliers of local region / existing suppliers of related OEM's
1 manufacturing unit.
- Negotiations and cost finalization happens in Japan.
- Supplier is finalized (based on Q-C merit) and nomination information given to supplier.

2 - Purchasing informs to R&D about supplier decision.

- Customer's R&D gets in touch with supplier and starts development.

3
- ECN's and all related commercial related cost discussions and finalization.

4 - Customer's Japan Purchasing informs to their local unit about supplier nomination.

5 - Customer's Japan R&D gives technical information to their local unit.

6 - Technical & commercial discussion between supplier's sister units.

-Customer's Local unit gets in touch with the nominated supplier.

7
- LOI is officially released to the supplier (at Japan finalized rates).
 GENERAL OBSERVATIONS

SUPPLIER'S REGIONAL MFG.

- CENTRALISED DECISION MAKING IN JAPAN.
- ALL COMMERCIALS, TECHNICAL DISCUSSION / NEGOTIATIONS IN JAPAN ONLY.

UNIT
- OEMs LOCAL UNITS HAVE VERY LITTLE TO NO SAY IN SUPPLIER NOMINATION / COMM

- JAPAN HQ WAS SENDING M/L DECISION TO LOCAL UNIT WHERE THE LOCAL UNIT HAD
LITTLE SAY IN THE PROCESS (EXCEPT IN HMSI)

nfo. All decisions are still be centrally controlled by SMC Japan.

pliers of related OEM's

iven to supplier.

n.

omination.
S IN JAPAN ONLY.

R NOMINATION / COMMERCIAL.

RE THE LOCAL UNIT HAD VERY

YMC'S NEW SUPPLIER NOMINATION PROCESS
YMC
3
MINDA JAPAN OFFICE PURCHASE R&D

PLATFORM MODELS ;
PLATFORM COMPONENTS
1
5
REGIONAL MFG. UNITS
2 2 2
YIMM IYM YVN

SUPPLIER'S REGIONAL UNIT

- Platform model list created

- Platform model potential suppliers identified at global level. If supplier name not in this list
1 then no scope of RFQ.
- Inputs from local units is taken from worldwide to create the above 2 lists.
- 1 platform model = 1 global supplier

2 Q-C benchmarking happening among local units and inputs being given at platform level for
common parts.

- RFQ is sent to all potential suppliers (irrespective of location of supplier or customer's

manufacturing unit.)
3
- Commercials are negotiated based on Cost inputs from OEM's local units . M/L created.
Pre-information given to supplier regarding nomination.
- Technical discussion / design finalization prior to nomination with supplier

-Customer's Local unit gets in touch with the nominated supplier.

4
- Production DCS is officially released to the supplier.

5 - Technical & commercial discussion between supplier's sister units.

 GENERAL OBSERVATIONS:

- ALL MINDA PRODUCT ARE IN PFCD CATEGORY

- NOW Q-C BENCHMARKING IS BEING DONE BY LOCAL OEM UNITS WITH EACH OTHER.
- LOWEST COST SUPPLIER IS BEING GIVEN PREFERNCE (IRRESPECTIVE OF COUNTRY) AND
BEING ASKED & NEGOTIATED WITH EXISTING SUPPLIERS
- FINAL DECISION MAKING IS STILL CENTRALIZED IN JAPAN
- SOB BALANCING FOR MULTIPLE SOURCES IS ALSO DECIDED IN JAPAN
- PFCD + LOCAL UNITS ARE DECIDING FOR NEW APPLICATION
2
- JAPAN OFFICE INTERFACE : PROGRAM MANAGEMENT, CONCURRENT ENGINEERING;
HLYM (etc.)
COMMERCIAL NEGOTIATION

f supplier name not in this list

above 2 lists.

ng given at platform level for

of supplier or customer's

s local units . M/L created.

with supplier

er.

units.
EM UNITS WITH EACH OTHER.
RRESPECTIVE OF COUNTRY) AND DELTA IS

AN
DED IN JAPAN
TION

CONCURRENT ENGINEERING;
HONDA NEW SYSTEM

HM - JAPAN

INTERFACE
SUPPLIER's
JAPAN
2 GLOBAL GLOBAL R&D
PURCHASING (HGA)

REGIONAL CENTERS
6
SUPPLIER's REGIONAL

HRS-T (THA)
INTERFACE

ASIAN HONDA
HRID (IND)
PURCHASING

HRS-IN (IDN)

REGIONAL MFG. UNITS

AHM HMSI
REGIONAL MFG.

4 7
SUPPLIER'S

UNIT

THM

HVN
 HGA :
1. Worldwide platform development (Premium, Super premium, ATV, Off-Road etc.)
2. New vehicle platforms development (all segments)
3. New Product development (with 1st supplier)
4. New Technology development

3
1
HRS-T :
1. Economy & Executive bikes platform management
2. Development of alternative supplier of existing product (technologies that have
already been developed by HGA for 1st vendor)

HRID : Subsidiary of HRS-T

HRIN : Subsidiary of HRS-T

`

GENERAL OBSERVATIONS
1. IN HONDA, REGIONAL UNITS CAN RE-NEGOTIATE WITH THE NOMINATED V
HEAVILY NEGOTIATED BY HM PUR OR ASIAN HONDA PUR.

KSS 2. LOCAL UNITS HAVE HUGE POWER TO PUSH FOR OR REJECT ALTERNATIVE V
HRST .
HONDA BRASIL 3. Q-D MERIT, SUPPLIER'S RELATIONSHIP AT JAPAN AND REGIONAL LEVEL PLA
NEW MODEL BUSINESS DECISIONS.
HONDA ITALY

- HGA takes inputs from Local units to prepare new model

1
- Q-C data base is created based on inputs from local units
- Specs are finalised.
HGA / LOCAL UNITS

- Global RFQs are issued to all potential (shortlisted) suppli

- Commercial negotiations & price settlement
2

- Concurrent engineering & Program management through

- HGA freezes M/L and sends info to Local units.

- Mostly M/L notification is followed by local units. (except
3/4
- Local units issue notification to local units, another round
begins.

- Local unit requests local R&D centers for alternate vendo

technology/ product.
OCAL UNITS

5
 - Local R&D centers can also develop alternative vendors a

LOCAL R&D CENTERS / LOCAL UNITS

cost down activity.
5 - Local R&D centers cannot impose their decisions on the lo
- Local R&D centers issue RFQs to potential alternative sup
- Commercial negotiations & price settlement

- Product development & Program management through S

- Commercial negotiations & price settlement

6
- Product development & Program management through S

- Another round of commercial negotiations & price settlem

7
- LOI is issued to supplier.
m, ATV, Off-Road etc.)

hnologies that have

E WITH THE NOMINATED VENDOR EVEN IF ALREADY

DA PUR.

OR REJECT ALTERNATIVE VENDORS PROPOSED BY HGA /

N AND REGIONAL LEVEL PLAY A VERY IMPORTANT ROLE IN

nits to prepare new model line up for specific regions.

d on inputs from local units & local R&D centers

otential (shortlisted) suppliers.

ce settlement

gram management through Suppliers Japan interface.

fo to Local units.
owed by local units. (except HMSI)
o local units, another round of commercial negotiation

centers for alternate vendors of already developed

velop alternative vendors and propose to units mainly as

ose their decisions on the local units

to potential alternative suppliers.
ce settlement

am management through Suppliers regional interface.

ce settlement

am management through Suppliers regional interface.

negotiations & price settlement .